2009 Corn Annual - Contributions from Corn Refining: Jobs, Environment, Communities

Contributions from Corn Refining: Creating Jobs, Improving the Environment, and Strengthening Communities

Corn Refiners Association 2009 Annual Report

2009 CORN ANNUAL

BOARD OF DIRECTORS J. Patrick Mohan, Chairman Tate & Lyle Americas Edward A. Harjehausen, Vice Chairman Archer Daniels Midland Company Dennis C. Riddle Archer Daniels Midland Company Alan D. Willits Cargill, Incorporated Jeff A. Cotter Cargill, Incorporated Jack C. Fortnum Corn Products International, Inc. Richard N. Kyle Corn Products International, Inc. James P. Zallie National Starch LLC Neil S. Grimwood National Starch LLC Timothy M. Kortemeyer Penford Products Co. William C. Winetroub Penford Products Co. Dominique D.P. Taret Roquette America, Inc. Richard A. O’Hara Roquette America, Inc. Matthew D. Wineinger Tate & Lyle Americas

STAFF Audrae Erickson President James Callan Senior Director of Communications Constance Cullman Senior Director of Regulatory, Technical and International Affairs David Knowles Director of Communications Pat Saks Director of Policy and Operations Nancy Kohler Assistant Director for Policy and Operations Shannon Weiner Executive Assistant

2009 CORN ANNUAL

TA B L E O F C O N T E N T S Foreword ..................................................................................................... 2 Audrae Erickson, President, Corn Refiners Association Research is Key to Agriculture’s Ability to Meet Demands of a Changing World ...................................................... 3 Representative Frank Lucas, Ranking Member, House Committee on Agriculture Year in Review ............................................................................................. 5 J. Patrick Mohan, Chairman, Corn Refiners Association Corn Refiners Making a Positive Impact in Their Communities .................. 8 Increasing Value While Reducing Impact: Corn Refiners’ Commitment to the Environment............................................................. 12

Corn Industry Statistics U.S. Corn Refining Industry at a Glance – 2008 ......................................... 2 Exports of Products from Corn – 2008 ....................................................... 4 Safety Program Award Winners ................................................................... 5 Shipments of Products of the Corn Refining Industry – 2008 ..................... 6 Corn: Supply and Disappearance ................................................................ 7 Corn: Food and Industrial Uses ................................................................... 8 U.S. Per Capita Sweetener Deliveries for Food and Beverage Use ........................................................................ 10 World Corn Production, Consumption, and Stocks .................................. 11 Corn for Grain: Acreage, Yield, and Production ........................................ 14 Corn Refiners Association Member Companies Products .......................... 15 Corn Refiners Association Member Companies Domestic and International Plant Locations .............................................. 16

2009 CORN ANNUAL | PAGE 2

Foreword Audrae Erickson, President, Corn Refiners Association Corn refiners make a positive impact in their communities through environmental stewardship, economic growth, energy efficiency, and waste minimization. The corn wet milling industry is a leader in environmental stewardship, while producing hundreds of products and ingredients that Americans rely on every day. From corn starch, to sweeteners, to bio-degradable plastics, to renewable fuels, corn refiners are building a brighter future.

Our member companies are active in their communities and continuously strive to enrich the neighborhoods where they do business. Their efforts involve community improvement and outreach projects, donations to local charities, support of learning institutions, and assurance of safe and rewarding places to work.

We are pleased to welcome The Honorable Frank D. Lucas (OK-3rd) as our featured guest author.

As the Ranking Member of the House Committee on Agriculture, Representative Lucas is an avid supporter of rural farming communities. His contribution explores the need for continued investment in research to help agriculture keep pace with the demands of a changing world while maintaining farmers’ ability to preserve our natural resources.

J. Patrick Mohan, Chairman, Corn Refiners Association, contributes the Year In Review to the 2009 Corn Annual providing a perceptive assessment of the challenges that face the corn refining industry, as well as the positive impact of our industry on local communities, our nation, and the world. His insight on the issues reflects his extensive experience in the corn refining industry.

We also value our long-standing partnerships with our member organizations, customers, academic institutions, Members of Congress, federal agencies, and ally groups. Working with them, we have made significant strides in the past year.

The corn refining industry plays an important role in our country’s rural landscape through responsible environmental stewardship and thoughtful community outreach. In times of economic downturn, this role is increasingly important. We look forward to remaining a valuable contributor to local communities and the American economy.

U.S. CORN REFINING INDUSTRY AT A GLANCE — 2008 Corn Refining Plants Location Corn Grind Value of Corn Purchased Number of Corn Suppliers Employment by CRA Member Companies Capital Investment (replacement value) Major Products (estimated) Sweeteners (dry weight) Starches Ethanol Co-products Value Added by Manufacture

27 12 states 1.4 billion bushels $6.6 billion 41,000 65,300* $14.4 billion 23.1 billion pounds 6.6 billion pounds 1.2 billion gallons 26.1 billion pounds $6.6 billion

*Includes employees that provide services in non-corn refining areas.

Compiled by the Corn Refiners Association based on 2008 data from the U.S. Department of Agriculture, LMC Commodity Studes, Renewable Fuels Association and industry data compiled for CRA by Veris Consulting, LLC.

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2009 CORN ANNUAL | PAGE 3

Research is Key to Agriculture’s Ability to Meet Demands of a Changing World Representative Frank Lucas, Ranking Member, House Committee on Agriculture America’s farmers and ranchers have long been the source for our most basic needs, including food, fiber, feed, and fuel. For them, farming is a way of life that has been passed down from generation to generation. At the same time, they have also been mindful of preserving our natural resources. Our farmers know that their legacy and livelihood depend on fertile soils, clean water, and fresh air. They have spent generations protecting millions of acres and miles of riverfronts in order to continue to produce the safest, most abundant, most wholesome, and most affordable food supply this world has ever known.

Agriculture is a major component of our economy. The food and agriculture sectors and their related industries provide more than 20 million jobs in the U.S., and account for nearly $1 trillion of gross national product. Agriculture exports average more than $50 billion annually, compared to $38 billion in imports, contributing some $12 billion to reduce the $350 billion trade deficit in the nonagricultural sector.

Many factors play a role in the unparalleled success of American agriculture. Hard work and dedication of farm families, favorable soils and climate, better herbicides, free enterprise, transportation, and communication to name a few. But, one factor that has made a significant impact on the success of this industry is agricultural research. Science-based advances in food and agriculture have enabled the expansion of food production. At the same time, it has helped farmers use less land to produce higher yields, which is beneficial to society from both a consumer and an

environmental standpoint. For example, with corn production the yield per acre has increased by 114 percent over the last four decades. In 1970, the U.S. produced 72 bushels of corn per acre compared to 154 bushels per acre in 2008.

The contribution of agricultural research to advance food production and productivity is well documented. These improvements in agricultural productivity, generated by research, are of great importance to the American farmer, but even greater importance to society as a whole. These improvements have helped create an efficient production system that is competitive in the global environment. They have contributed to providing a safe and secure food and fiber supply, a healthy, well-nourished population, and a growing economy. New technologies have ultimately saved over a billion lives from starvation and countless millions more from the ravages of disease and sickness due to malnutrition.

Despite these successes, there are still many challenges that remain. One of those challenges involves increasing food production to meet the needs of an ever demanding global population. If we are to produce enough food and fiber to meet those needs and to make more efficient use of land already in cultivation, then we must put all the tools that science and research have to offer to work.

Additionally, there is a need to further explore options in the renewable fuels market because the potential for converting a wide variety of agricultural products to clean energy is promising.

Increased research is needed to develop new technologies that will facilitate this trend. This will encourage new markets

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2009 CORN ANNUAL | PAGE 4 for agricultural waste products such as corn stover, animal waste, and forest-based biomass.

We also need to continue to find ways to cut the cost of producing food and fiber in our country, so that our farmers will have an economically viable future. Agricultural research plays a vital role in finding ways to increase production and lower input costs.

Research in new seed varieties that require less water and fertilizer to harvest holds great promise for the future of agriculture.

Seed varieties make it possible to raise yields in crops, increase nutritional values, reduce pesticide and fertilizer use, as well as conserve land and water. We must continue to explore more methods for greater efficiency in crop production that still result in producing a quality crop.

One recent technological advance is precision agriculture. That is, using satellites and global positioning systems (GPS) to distribute seed and fertilizer in a precise way so that a farmer can maximize crop yields at the lowest cost. This technology encourages the reduction of waste and maintains the integrity of the environment. However, more research is needed in this area so that farmers can capitalize on a more efficient operation.

The continued success of the American farmer is dependent on new and expanded market opportunities that increase the stability of American agriculture. Although farmers naturally find new and innovative ways to increase production and reduce costs, agricultural research is crucial in keeping our farmers in business, which ensures that both the U.S. and the world can enjoy a safe, abundant, and affordable food, fiber, and fuel supply.

EXPORTS OF PRODUCTS FROM CORN—2008 Product

Volume

Units

Value

Corn meal

312,148,682

Kilograms

$114,249,659

Corn starch

112,179,267

Kilograms

$67,062,172

Corn oil, crude

153,370,872

Kilograms

$223,859,455

13,274,747

Kilograms

$17,191,732

Corn oil, once refined Corn oil, fully refined

182,567,734

Kilograms

$294,048,753

Glucose (dextrose)

113,491,328

Kilograms

$ 63,011,769

Glucose syrup not containing fructose or containing in the dry state less than 20% fructose

305,088,953

Kilograms

$113,586,615

Glucose syrup with 20 – 50% fructose

162,218,031

Kilograms

$48,094,905

Chemically pure fructose Fructose syrup with 50%+ fructose Fructose solids containing more than 50% fructose Bran, sharps, and other residues

92,863,097

Kilograms

$78,037,858

533,656,175

Kilograms

$182,125,200

4,930,384

Kilograms

$23,465,917

198,850

Metric tons

$30,725,209

Corn gluten feed

1,265,509

Metric tons

$272,616,290

Corn gluten meal

1,044,974

Metric tons

$470,848,695

225,204

Metric tons

$34,738,212

Corn oil cake

25,910,223

Kilograms

$6,137,219

Dextrins

37,061,858

Kilograms

$31,168,138

256,933,901

Kilograms

$208,433,187

Other residues of starch manufacturing

Modified starches derived from corn starch

Source: U.S. Department of Commerce

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2009 CORN ANNUAL | PAGE 5

Year in Review J. Patrick Mohan, Chairman, Corn Refiners Association Tate & Lyle Americas CRA Soon to Celebrate 100 Years of Service In just four years, the Corn Refiners Association will celebrate its one-hundredth anniversary. During this time, engineering developments have improved plant efficiency, product quality, and consumer choice. Today, refined corn ingredients offer significant functional characteristics enabling a wide range of products that enrich consumers’ lives in a myriad of ways, including through food, pharmaceutical, and industrial applications.

During my tenure as Chairman of the Corn Refiners Association, I feel privileged to have been part of an industry team that is dedicated to finding solutions and raising the bar, while facing challenges on domestic and global levels. It is an industry that realizes the importance and the long-term benefits of its role in providing jobs and innovative products for consumers, while helping maintain our environment and bolstering the national economy. It is an industry with a rewarding past and a bright future.

measurable progress. Because of the campaign’s comprehensive approach – grounded in fact-based, peer-reviewed, scientific research – numerous dietitians, health professionals, and other influencers that shape consumer opinions now recognize the science-based facts about high fructose corn syrup and sugar: that they are nutritionally the same.

SAFETY PROGRAM AWARD WINNERS Outstanding Safety Award Corn Products International, Inc. – Bedford Park, IL National Starch LLC – Indianapolis, IN – North Kansas City, MO

Distinguished Safety Award Archer Daniels Midland Company – Clinton, IA – Columbus, NE Cargill, Incorporated – Memphis, TN Corn Products International, Inc. – Bedford Park, IL National Starch LLC – Indianapolis, IN Tate & Lyle Americas – Loudon, TN

Prioritizing Safety CRA Safety Awards Program Implemented

Award for Safety Achievement

The CRA has always recognized the vital importance of safety in its plants, products, and manufacturing processes. In recognition of our industry’s commitment to safety, a new awards program was implemented to further underscore its importance. We are pleased to recognize and honor the award recipients for their dedication and commitment to a safe working environment.

Cargill, Incorporated – Cedar Rapids, IA – Decatur, AL – Hammond, IN – Memphis, TN – Wahpeton, ND

Public Relations and Advertising Efforts The CRA multimedia public relations and advertising campaign on high fructose corn syrup that began in 2008 has resulted in

Archer Daniels Midland Company – Clinton, IA – Columbus, NE

Corn Products International, Inc. – Bedford Park, IL – Stockton, CA National Starch LLC – Indianapolis, IN – North Kansas City, MO Tate & Lyle Americas – Loudon, TN

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2009 CORN ANNUAL | PAGE 6 Notably, when consumers are presented with the facts, their views about high fructose corn syrup often change, resulting in a greater understanding of its important role in our nation’s food and beverage supply and its metabolic equivalence to sugar. High fructose corn syrup is more economical than sugar, equally sweet, has the same number of calories, and is handled similarly by the body.

Like sugar, it should be enjoyed in moderation as a part of a healthy lifestyle. High fructose corn syrup remains the most economical, functionally superior caloric sweetener on the market. It makes many foods and beverages possible at affordable prices; an important attribute in today’s economical environment.

Outreach Efforts In 2009, the CRA secured sponsorships, speaking opportunities, and exhibited at professional conferences hosted by numerous organizations reflecting a wide variety of interests in the dietetic, food and beverage technology, health, nutrition, wellness, and weight management arenas. These opportunities enabled us to reach multiple audiences through presentations from independent scientific experts and to provide factual information based on credible science.

Sweetened Beverage Tax This year, our industry joined the Americans Against Food Taxes coalition working with

hundreds of national and state groups, to oppose taxes on sweetened beverages to pay for health care reform. No single food or beverage is responsible for obesity in America.

All calories count and that is why taxing a single component of the nation’s complex food and beverage supply will not make Americans healthier.

Climate Change The corn wet milling industry takes seriously its responsibility to minimize greenhouse gas emissions and has a long history of working proactively and voluntarily with the U.S. Environmental Protection Agency. Our industry is a strong advocate of a greenhouse gas emission reduction program that results in cleaner air, while accommodating the public’s need for affordable energy and protecting American jobs and rural communities.

The efficient use of resources is essential for corn refiners to stay competitive, whether it is water re-use, waste minimization or air emission reductions – all areas in which the corn wet milling industry has excelled. Because of the economic effects of high energy prices, it is vital that our manufacturing facilities continue to seek new ways of finding sustainable uses of energy and water resources.

The positive strides made on environmental

SHIPMENTS OF PRODUCTS OF THE CORN REFINING INDUSTRY – 2008 Starch Products (includes corn starch, modified starch and dextrins) Refinery Products

(includes glucose syrup, high fructose corn syrup, dextrose, corn syrup solids, maltodextrins)

High Fructose Corn Syrup 42% High Fructose Corn Syrup 55% and Above Total High Fructose Corn Syrup Total — Domestic Basic Products

6,081,486,000 31,168,715,000 9,247,027,000 12,246,642,000 21,493,669,000 37,250,201,000

Total — Export Basic Products

2,961,755,000

Corn Oil — Crude and Refined

1,195,664,000

Corn Gluten Feed and Corn Oil Meal

10,399,186,000

Corn Gluten Meal

2,252,675,000

Steepwater

1,491,511,000

Compiled for the Corn Refiners Association by VERIS Consulting, LLC. Statistics represent shipments by members of the Association. Shipments are in pounds, commercial weights, and do not include co-products derived from ethanol production.

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2009 CORN ANNUAL | PAGE 7 ensure that all appropriate safeguards are instituted to prevent serious degradation of high quality starches from this trait.

controls and energy efficiency underscores a strong and continued industry commitment to operating in responsible, effective, and beneficial ways.

On the international front, corn gluten feed exports to Europe remain flat due to the European approval process which lacks scientific merit. We support U.S. government efforts to work with its European partners in a timely manner that leads to a science-based, speedy return of normal trade flows of U.S. high-quality, high-protein corn gluten feed to Europe.

Biotechnology Our industry has a long-standing commitment to advances in agricultural technology. Increased crop yields make food more affordable for consumers around the globe and biotechnology achieves higher yields with less impact on the environment.

Regulatory control of new technologies is an important component in maintaining consumer confidence in biotechnology and keeping export markets open for U.S. food and agricultural commodities, while maintaining jobs from value-added technology.

International Trade Our industry strongly supports new market access for refined corn products and believes that trade offers consumers around the globe increased product choices at affordable prices. Congress should ratify the proposed bilateral agreements with Korea, Colombia, and Panama. All three agreements, if passed, would reduce tariffs to zero on corn wet milled products over the life of these agreements. The CRA also supports the timely conclusion of the World Trade Organization negotiations in a manner that results in new market opportunities for our industry.

For these reasons, our industry has voiced serious concerns about the potential deregulation of Syngenta Seeds Corn Event alpha-amylase (Event 3272) which breaks down starch and, if misdirected into corn wet milling operations, could jeopardize the ability of corn refiners to deliver high-end starches for food and industrial applications.

We have urged government officials to first

CORN: SUPPLY AND DISAPPEARANCE

Seed

Feed and Residual

Total Domestic Disappearance

Exports

6.8

11,689.4

1,937.6

19.3

5,824.1

7,799.0

1,941.3

9,740.3

1,899.1

9,502.6

10.1

11,411.8

2,026.3

20.1

5,864.2

7,910.63

1,904.8

9,815.4

1,596.4

2002

1,596.4

8,966.8

14.5

10,577.7

2,320.2

20.0

5,562.9

7,903.10

1,587.9

9,491.0

1,086.7

2003

1,086.7

10,087.3

14.1

11,188.0

2,516.6

20.6

5,793.0

8,330.13

1,899.8

10,230.0

958.1

2004

958.1

11,805.6

10.8

12,774.5

2,666.2

20.8

6,155.5

8,842.47

1,818.1

10,660.5

2,114.0

2005

2,114.0

11,112.2

8.8

13,235.0

2,961.8

19.9

6,152.3

9,133.99

2,133.8

11,269.7

1,967.2

2006

1,967.2

10,531.1

12.0

12,510.0

3,467.0

23.8

5,591.0

9,081.25

2,125.4

11,206.6

1,303.7

2007

1,303.7

13,038.0

20.0

14,362.0

4,365.0

22.0

5,913.0

10,299.99

2,437.0

12,737.4

1,624.2

2008*

1,624.0

12,101.0

15.0

13,740.0

4,898.0

22.0

5,250.0

10,170.00

1,850.0

12,020.0

1,720.4

2009**

1,720.4

12,761.0

15.0

14,496.4

5,425.3

22.7

5,300.0

10,775.00

2,100.0

12,875.0

1,621.4

Ending Stocks

Food, Alcohol, and Industrial

9,915.1

1,899.1

Total Disappearance

Total

1,717.5

2001

Imports

2000

Production

Beginning Stocks

Disappearance

Year Beginning September 1

Supply

Source: USDA—Economic Research Service. Latest data may be preliminary or projected. Totals may not add due to rounding. * Preliminary **Projected (in million bushels)

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2009 CORN ANNUAL | PAGE 8

Corn Refiners Making a Positive Impact in Their Communities specific sector exceeds $3.3 billion. Nearly 41,000 farmers benefit from the sale of their corn to corn wet millers, more than a quarter of which supply corn to the industry from Indiana alone.

The corn refining industry plays an important part in strengthening the economy of rural America by supporting the local communities where they do business. Corn refiners make a significant contribution to the health of our national economy and the local markets where refining plants are located serving as a cornerstone of employment. Commitment to community does not end with sustainable jobs; corn refiners also build strong bonds through charitable donations, educational support, community development, and provide their employees with a safe and rewarding workplace.

Corn refiners also contribute to the economy through purchases of material inputs such as utilities, fuels, shipping materials, transportation and manufacturing equipment, processing chemicals/enzymes, and other items necessary for plant operations. Nationwide, corn refiners spend more than $23 billion annually on these types of expenditures, which have further multiplier effects in our nation’s rural areas.

Economic Impact

Another important economic contribution from the corn refining industry is property taxes. Corn refiners add nearly $8.8 billion annually to local economies through payment of property taxes, which in turn provides American citizens important public services.

The member companies of the corn refining industry collectively provide well-paying jobs to over 65,000 employees across the country.

In Illinois, almost 11,000 individuals work in the industry. The national payroll for our

CORN: FOOD AND INDUSTRIAL USES Year

High Fructose Corn Syrup

Glucose & Dextrose

Starch

Beverage Alcohol

Cereals & Other Products

Total

1990

379

200

219

349

135

124

1,406

1995

473

227

226

396

125

161

1,608

2000

530

218

247

628

130

185

1,938

2001

541

217

246

706

131

186

2,027

2002

532

219

256

996

131

187

2,321

2003

530

228

271

1,168

132

187

2,516

2004

521

222

277

1,323

133

189

2,567

2005

529

229

275

1,603

135

190

2,961

2006

510

239

272

2,119

136

190

3,466

2007

490

236

262

3,026

135

192

4,341

2008

465

227

230

3,650

134

192

4,898

2009*

465

230

230

4,200

134

193

5,452

Fuel Alcohol

Source: USDA—Economic Research Service. Year Beginning Sept. 1. *Estimated (In million bushels)

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2009 CORN ANNUAL | PAGE 9

Community Development Corn wet milling plants represent a significant capital investment and, as such, represent a stable entity in the communities where they are located. But the investment goes far beyond the boundaries of the plant location. Many corn refiners enrich their communities through a wide variety of efforts. Community involvement benefits residents, and offers plant employees opportunities for personal development and a sense of pride from their contributions to society.

There are several methods through which corn refiners support community development including project funding, human resources, and donation of products and equipment.

Doing business in an engaged community is positive for corn refiners. Many companies support community leadership development by sponsoring or organizing opportunities for citizens to connect, learn, and generate ideas for community improvement.

Fostering future community leaders through sponsorship of youth employment opportunities is another way corn refiners support their neighborhoods.

Corn refiners frequently fund community improvement projects.

Local residents can often enjoy outdoor activities such as biking a linear path, playing baseball on a groomed field or playing on a safe, clean playground due to support from the corn wet milling industry via project funds or employee volunteer efforts. Corn refiners also support development of active communities through sporting events and field days.

Support of the arts include efforts such as sponsoring exhibits at local museums, commissioning works of art for city beautification projects, and organizing programs to expand cultural experiences of students.

Corn refiners often contribute financially to charity sporting events.

Fostering pride in community is another way corn refiners make a positive impact. Community cleanup and recycling programs are frequently supported through employee volunteers. Residents can often find corn refiners listed in the sponsors of city-wide festivals and celebrations.

Charitable Donations Numerous corn refining plants actively participate in raising funds for local charities. Their support takes several forms, including direct contributions and grants, matching gifts, and employee volunteers.

Local organizations benefit from activities such as sponsored walks, food drives, and clothing donations. Charities that benefit from these efforts range from well-established organizations such as the Helping young minds flourish through volunteer activities United Way, Salvation Army, and Habitat for Humanity to local is another way corn refiners commonly support local community organizations. communities.

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2 0 0 9 C O R N A N N U A L | P A G E 10 Education A strong educational system helps build vibrant communities. Corn refiners are avid supporters of educational initiatives for children and young adults.

Children in primary and secondary schools benefit from employee volunteers who share their knowledge of agriculture, science, and other areas of expertise. Corn refiners sponsor special events and programs that help students learn about the farming industry and agricultural business. Educational support also comes from monetary donations that help fund field trips, purchase supplies and equipment, and fund teacher training.

Students in secondary schools are likely to encounter volunteers from local plants at career fairs where students learn about careers in corn refining, and how corn-wet milled products enhance their lives. Scholarships

and award programs sponsored by corn refiners fosters academic excellence and encourages students to pursue careers in engineering, computer programming, science, and business management.

Corn refiners support colleges and universities by supporting key research initiatives.

Financial contributions take the form of donations for general academic support, scholarships for work/study programs, grants to develop specific areas of study, and as endowments.

Licensing technologies developed by universities is another way that corn refiners support higher education, which can be fiscally and academically rewarding.

Safe and Rewarding Workplace Part of being a responsible member of the community involves creating and maintaining

U.S. PER CAPITA SWEETENER DELIVERIES FOR FOOD AND BEVERAGE USE* Year

Refined Sugar

High Fructose Corn Syrup

Glucose

Dextrose

Total

Honey and Edible Syrups

Total Caloric Sweeteners

CORN SWEETENERS (DRY BASIS) 1966

97.3

0.0

9.7

4.2

13.9

1.7

112.9

1970

101.8

0.5

10.7

4.6

15.9

1.5

119.1

1980

83.6

19.0

12.9

3.5

35.3

1.3

120.2

1990

64.4

49.6

13.6

3.6

66.8

1.2

132.4

2000

65.5

62.7

15.8

3.4

81.8

1.5

148.9

2001

64.5

62.6

15.5

3.3

81.4

1.4

147.3

2002

63.3

62.9

15.5

3.3

81.6

1.5

146.5

2003

61.0

61.0

15.2

3.1

79.3

1.4

141.7

2004

61.7

59.9

15.6

3.3

78.9

1.3

141.9

2005

63.2

59.2

15.3

3.3

77.8

1.5

142.5

2006

62.5

58.3

13.8

3.1

75.2

1.6

139.3

2007

62.1

56.3

13.7

3.0

73.0

1.4

136.5

2008

66.3

53.2

13.4

2.8

69.3

1.4

137.1

Source: USDA—Economic Research Service Units measured in pounds * Per capita deliveries of sweeteners by U.S. processors and refiners and other end users represent the per capita supply of caloric sweeteners. Actual human intake of caloric sweeteners is lower because of uneaten food, spoilage, and other losses. Figures do not include deliveries to alcohol manufacturers.

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2 0 0 9 C O R N A N N U A L | P A G E 11 a workplace where employees thrive in a safe, rewarding environment.

Corn refiners are committed to providing a safe work environment. Following Occupational Safety & Health Administration regulations and engaging employees to design and implement outstanding safety programs that “go the extra mile” are examples of how corn refiners demonstrate their responsibility to employees’ safety. Many plants also collaborate with local fire departments and emergency response teams to conduct drills for emergency preparedness.

Encouraging employees to adopt healthy lifestyles contributes to a safe and enriching work environment. Many plants offer exercise facilities or company-sponsored fitness programs. Other activities to promote health and fitness include health fairs, flu vaccinations, exercise programs, and educational sessions on health-related topics. Additionally, corn refiners provide donations to local hospitals for equipment or special programs that benefit employees and members of the community alike.

Providing access to a variety of continuing education and development opportunities contributes to a gratifying workplace. It also benefits the local community through support of higher education institutions. Corn refiners support employee education and development through continuing education assistance as well as in-house training on topics ranging from ingredient development to effective people management.

Corn refiners also help employees thrive by providing opportunities to make valuable contributions to the company. Employees are often encouraged to utilize their skills and knowledge to collaborate with colleagues to find ways to improve operations.

The support and commitment of corn refiners to their neighbors extends beyond these illustrative examples. It is an industry that is committed to enriching local communities and its employees, and making invaluable contributions to American lives.

WORLD CORN PRODUCTION, CONSUMPTION, AND STOCKS 2007/08 2008/09 (thousand metric tons)

Production

Argentina Brazil Canada China Egypt EU-27 India Indonesia Mexico Nigeria Philippines Russian Federation Serbia South Africa Ukraine Others United States World Total

22,000 58,600 11,649 152,300 6,174 47,554 18,960 8,500 23,600 6,500 7,277 3,950 4,054 13,164 7,400 69,018 331,177 791,877

Total Consumption Argentina Brazil Canada China Egypt EU-27 India Indonesia Japan Republic of Korea Mexico Nigeria Philippines South Africa Vietnam Others United States World Total

Ending Stocks Brazil China EU-27 Iran Republic of Korea Mexico South Africa Others United States World Total

12,600 50,000 10,600 165,900 6,217 62,688 18,480 8,700 25,000 7,900 6,846 6,600 5,900 12,000 11,400 71,210 307,386 789,427

7,000 42,500 13,769 149,000 10,400 63,900 14,200 8,500 16,600 8,633 32,000 6,550 7,150 9,200 5,200 114,090 261,632 770,601

6,400 44,500 12,500 152,000 10,300 61,000 17,600 8,800 16,400 7,600 32,600 7,800 7,300 9,800 5,200 116,245 258,965 775,056

12,579 39,394 4,461 2,137 2,084 4,131 3,490 20,783 41,255 130,314

11,379 53,094 6,899 2,137 1,578 3,831 3,290 19,412 43,065 144,685

Source: USDA—Foreign Agricultural Service. Based on local marketing years in thousand metric tons.

2 0 0 9 C O R N A N N U A L | P A G E 12

Increasing Value While Reducing Impact: Corn Refiners’ Commitment to the Environment The production and utilization of corn in American society has long played a role in serving the needs of our country. That commitment has never been stronger than it is today. Whether it is the need to provide jobs to rural America, create ingredients that contribute to the daily lives of Americans, or working to address the growing environmental and energy priorities of the U.S. economy, the corn refining industry is leading the way.

Advances in environmentally-beneficial practices in the corn refining industry start at the corn production stage. Farmers have initiated a green revolution by using new technologies and innovative practices that allow them to produce more corn with less energy and fewer resources. They have adopted sound practices in managing the land, reduced pesticide and fertilizer use, improved soil structure, and dramatically reduced topsoil erosion.

Increasing Efficiency in Plant Operations Commitment to the environment is a social responsibility that the corn refining industry takes seriously. Resource-efficiency helps reduce the industry’s environmental impact and provides financial incentives. Many corn refining companies have established notable sustainability goals for reduction of energy and water consumption, greenhouse gas and other emissions, as well as liquid and solid waste.

Corn refiners are leaders in waste minimization and are currently able to use approximately 99 percent of the corn kernel in their products.

Much of what is collected in air pollution control and water pollution control equipment is recycled into product streams.

Cogeneration energy production systems provide electricity and heat for process operations. These systems are more efficient than separate generation of electricity and heat, resulting in reductions in emissions and energy required to run the plant. Many of the facilities generate biogas from the responsible treatment C O R N R E F I N E R S A S S O C I AT I O N

of waste products that is captured and used to replace natural gas in animal feed dryers.

Corn refiners have had a century to refine, improve, and optimize ways to use the water necessary for the corn refining process. From a processing aid to a cooling mechanism, water serves a vital role in the manufacture of the many ingredients derived from the corn refining process.

As a result, multiple re-use of water is essential and is the primary means the industry uses to protect this valuable resource. In some corn refining processes, water is re-used up to 10 times. For example, at the initial stage of the wet milling process, the corn is steeped in water that has already been used many times in latter parts of the milling process (counter-current water flow) to better expand and separate the kernels into their component parts.

Products Provide Value and Reduce Impact Starch is one of the paper industry’s most important ingredients and provides numerous benefits that may not be obvious. For instance, more than 85 percent of starch used in the U.S. paper making process is corn starch. Starch is added to replace the natural binding agents the wood pulp loses during processing.

Starch is even more important in making recycled paper products. Recycled fiber is weak and needs the bonding strength that starch provides. Specifically, cationic starch serves as a strengthening agent and has allowed paper manufacturers to use recycled fibers more effectively. Not only does the ability to transform more recycled content into quality papers benefit the environment, the starch increases fiber retention, so the end product performs better; and the manufacturing process is cleaner and more efficient. Without cationic starches, it is difficult to recycle paper many times.

Highly specialized starches also can be used by other industries as effective and

2 0 0 9 C O R N A N N U A L | P A G E 13

environmentally superior alternatives to synthetic agents in wastewater treatment.

Recent advances in starch technology show promise in the area of adhesives because they require less water and subsequently less time and energy to dry than more traditional methods. More environmentally-friendly adhesives from starch may be able to replace current petroleum-based acetates and alcohols used to help laminate graphics onto cardboard and latexes used as binders in paper coatings.

Biodegradable and energy efficient caps, cups, paper coatings, fabrics, carpeting, and agricultural mulch films are all possible today because of three types of corn-based polymers. Corn-based plastics can be formed on traditional plastic equipment into bottles, containers, trays, and other packaging.

These products are compostable and play a critical role in the diversion of food scraps from landfills to composting facilities and further reduce greenhouse gas production.

Production of these corn-based polymers uses up to 68 percent less fossil fuel than comparable traditional plastics manufacturing and generates up to 55 percent fewer greenhouse gas emissions.

Corn-based products further enable new materials, such as fiber, to be developed from renewable feedstocks that use less energy.

The materials have become a superb choice for fabrics and carpeting, since they have excellent stretch, stain resistance, resilience, and hold color well.

Industry/Government Collaboration Corn refiners have long been proponents of and leaders in environmental responsibility through not only the use of energy efficient technologies and product development, but also conscientious compliance with environmental regulations. In perhaps the first-ever industry-led cooperative effort of its

kind, CRA worked successfully with the U.S. Environmental Protection Agency (EPA) to develop a more accurate way to measure volatile organic compound (VOC) emissions from corn wet milling facilities.

This measurement tool was approved by EPA and became the new official method for the corn wet milling Corn starch-based alternatives to industry. It quantifies total petroleum-based acetates, alcohols and VOC mass emissions on an latexes help the paper industry reduce its environmental footprint. individual VOC basis and significantly improves scientific understanding of VOC emissions, serving as a prototype for several other industries to better measure emissions.

Corn refiners/wet corn milling companies also participate in Energy Star®, a joint program of the U.S. EPA and the U.S. Department of Energy. Energy Star notes that the program helps us “all save money and protect the environment through energy efficient products and practices. EPA’s Energy Star partnership offers a proven energy management strategy that helps in measuring current energy performance, setting goals, tracking savings, and rewarding improvements.” All members of CRA participate in this innovative program.

In Summary Extraordinary strides in technological development employed by corn refiners are proactively meeting consumer, societal, and industrial demands. Through these continuous efforts, the industry is building a brighter future by using corn for a multitude of essential ingredients that meet consumers’ needs in a variety of unique and meaningful ways. These developments improve the American economy and remind us how widespread and beneficial corn refining has become.

C O R N R E F I N E R S A S S O C I AT I O N

2 0 0 9 C O R N A N N U A L | P A G E 14

CORN FOR GRAIN: ACREAGE, YIELD, AND PRODUCTION State

Area Harvested (thousand acres)

Yield (bushels per acre)

2006

2007

2008

2006

2007

2008

Production (thousand bushels) 2006

2007

2008

AL

165

280

235

72

78

104

11,880

21,840

24,440

AZ

18

22

15

170

185

165

3,060

4,070

2,475

AR

180

590

430

146

169

155

26,280

99,710

66,650

CA

110

190

170

165

182

195

18,150

34,580

33,150

CO

860

1,060

1,080

156

140

137

134,160

148,400

147,960

DE

161

185

152

145

99

125

23,345

18,315

19,000

FL

30

35

35

82

90

105

2,460

3,150

3,675

GA

225

450

310

110

127

140

24,750

57,150

43,400

ID

65

105

80

170

170

170

11,050

17,850

13,600

IL

11,150

13,050

11,900

163

175

179

1,817,450

2,283,750

2,130,100

IN

5,380

6,370

5,460

157

154

160

844,660

980,980

873,600

IA

12,350

13,900

12,800

166

171

171

2,050,100

2,376,900

2,188,800

KS

3,000

3,680

3,630

115

138

134

345,000

507,840

486,420

KY

1,040

1,340

1,120

146

128

136

151,840

171,520

152,320

LA

290

730

510

140

163

144

40,600

118,990

73,440

MD

425

465

400

140

101

121

59,500

46,965

48,400

MI

1,950

2,340

2,140

147

123

138

286,650

287,820

295,320

MN

6,850

7,850

7,200

161

146

164

1,102,850

1,146,100

1,180,800

MS

325

910

700

107

148

140

34,775

134,680

98,000

MO

2,630

3,270

2,650

138

140

144

362,940

457,800

381,600

MT

18

38

35

146

140

136

2,628

5,320

4,760

NE

7,750

9,200

8,550

152

160

163

1,178,000

1,472,000

1,393,650

NJ

64

82

74

129

124

116

8,256

10,168

8,584

NM

45

54

55

185

180

180

8,325

9,720

9,900

NY

480

550

640

129

128

144

61,920

70,400

92,160

NC

740

1,010

830

132

100

78

97,680

101,000

64,740

ND

1,400

2,350

2,300

111

116

124

155,400

272,600

285,200

OH

2,960

3,610

3,120

159

150

135

470,640

541,500

421,200

OK

220

270

320

105

145

115

23,100

39,150

36,800

OR

29

35

33

180

200

200

5,220

7,000

6,600

PA

960

980

880

122

124

133

117,120

121,520

117,040

110

97

65

97

121

133

SC

290

370

315

SD

3,220

4,480

4,400

31,900

35,890

20,475

312,340

542,080

585,200

TN

500

790

630

125

106

118

62,500

83,740

74,340

TX

1,450

1,970

2,030

121

148

125

175,450

291,560

253,750

UT

17

22

23

157

150

157

2,669

3,300

3,611

VA

345

405

340

120

86

108

41,400

34,830

36,720

WA

75

115

90

210

210

205

15,750

24,150

18,450

WV

26

27

26

120

111

130

3,120

2,997

3,380

WI

2,800

3,280

2,880

143

135

137

400,400

442,800

394,560

WY

45

60

52

129

129

134

5,805

7,740

6,968

US

70,638

86,520

78,640

149.1

150.7

153.9

10,531,123

13,037,875

12,101,238

Source: USDA窶年ational Agricultural Statistics Service. AK, CT, HI, ME, MA, NV, NH, RI, VT not estimated.

C O R N R E F I N E R S A S S O C I AT I O N

2 0 0 9 C O R N A N N U A L | P A G E 15

Archer Daniels Midland Company

Cargill, Incorporated

Corn Products International, Inc.

National Starch LLC

Penford Products Co.

Roquette America, Inc.

Tate & Lyle Americas

CORN REFINERS ASSOCIATION MEMBER COMPANIES PRODUCTS

Unmodified, food

•

•

•

•

•

•

•

Unmodified, industrial

•

•

•

•

•

•

•

•

•

•

•

•

•

Modified, industrial

•

•

•

•

•

•

•

Dextrins

•

•

•

•

•

•

•

STARCH PRODUCTS

Modified, food

Cyclodextrins

•

REFINERY PRODUCTS Glucose syrups

•

•

•

•

•

Maltodextrins

•

•

•

•

•

Dextrose monohydrate

•

•

•

•

•

•

•

•

Dextrose anhydrous High Fructose Corn Syrup-42

•

•

•

•

•

High Fructose Corn Syrup-55

•

•

•

•

•

Crystalline fructose

•

•

CO-PRODUCTS Crude oil

•

•

•

Refined oil

•

•

•

Corn gluten feed

•

•

•

•

•

•

•

Corn gluten meal

•

•

•

•

•

•

•

Corn germ or corn germ meal

•

•

•

•

•

•

•

Steepwater (CFCE)

•

•

•

•

•

•

•

Carbon dioxide

•

Corn fiber food/industrial ingredients

• •

•

•

FERMENTATION AND OTHER CHEMICALS Citric acid

•

•

Lactic acid

•

•

Lysine

•

Threonine

•

Xanthan gum

•

Erythritol Sorbitol

•

Xylitol

•

•

•

•

•

•

•

•

•

Mannitol

•

•

•

•

Maltitol

•

•

•

•

Hydrogenated starch hydrolysates

•

Glucose hydrolysates

•

OTHER Ethanol, fuel/industrial

•

Ethanol, beverage

•

•

•

•

Product P d li lists are accurate as off publication bli i d date, b but may change h with i h time. i Also available online at http://www.corn.org/memberproductlines.htm.

C O R N R E F I N E R S A S S O C I AT I O N

2 0 0 9 C O R N A N N U A L | P A G E 16

Corn Refiners Association Member Companies Domestic and International Plant Locations Archer Daniels Midland Company

Corn Products International, Inc.

P.O. Box 1470 Decatur, Illinois 62525

5 Westbrook Corporate Center Westchester, Illinois 60154

Domestic Plants: Cedar Rapids, Iowa 52404 Clinton, Iowa 52732 Columbus, Nebraska 68601 Decatur, Illinois 62525 Marshall, Minnesota 56258-2744

Domestic Plants: Bedford Park, Illinois 60501-1933 Stockton, California 95206-0129 Winston-Salem, North Carolina 27107

International Plant: Guadalajara, Jalisco, Mexico

Cargill, Incorporated P.O. Box 5662/MS62 Minneapolis, Minnesota 55440-5662 Domestic Plants: Blair, Nebraska 68008-2649 Cedar Rapids, Iowa 52406-2638 Dayton, Ohio 45413-8001 Eddyville, Iowa 52553-5000 Hammond, Indiana 46320-1094 Memphis, Tennessee 38113-0368 Wahpeton, North Dakota 58075 International Plants: Uberlandia, Minas Gerais, Brazil Song Yuan, China Haubourdin, Pas-de-Calais, France Krefeld, Nordrhein-Westfalen, Germany Castelmassa, Veneto, Italy Martorell, Barcelona, Spain Orhangasi, Bursa, Turkey

International Plants: Cardinal, Ontario, Canada London, Ontario, Canada Port Colborne, Ontario, Canada Guadalajara, Jalisco, Mexico San Juan del Rio, Queretaro, Mexico Tlalnepantla, Mexico State, Mexico Baradero, Buenos Aires, Argentina Chacabuco, Buenos Aires, Argentina Balsa Nova, Parana, Brazil Cabo, Pernambuco, Brazil Sao Goncalo, Rio de Janeiro, Brazil Mogi-Guacu, Sao Paulo, Brazil Llay-Llay, Valparaiso, Chile Shouguang, Shandong, China Cali, Valle del Cauca, Colombia Lima, Peru Eldoret, Rift Valley, Kenya Icheon, Kyungigi-do, South Korea Incheon, Bupyong-ku, South Korea Faisalabad, Punjab, Pakistan Cornwala, Punjab, Pakistan

National Starch LLC 10 Finderne Avenue Bridgewater, New Jersey 08807-0500 Domestic Plants: Indianapolis, Indiana 46221 North Kansas City, Missouri 64116 International Plants: Trombudo Central, Brazil Hamburg, Germany Shanghai, China

C O R N R E F I N E R S A S S O C I AT I O N

Penford Products Co. (A company of Penford Corporation)

P.O. Box 428 Cedar Rapids, Iowa 52406-0428 Domestic Plant: Cedar Rapids, Iowa 52404-2175 International Plants: Lane Cove, Sydney, Australia

Roquette America, Inc. 1417 Exchange Street P.O. Box 6647 Keokuk, Iowa 52632-6647 Domestic Plant: Keokuk, Iowa 52632-6647 International Plants: Lestrem, Pas-de-Calais, France Beinheim, Bas-Rhin, France Cassano Spinola, Alessandria, Italy Benifayo, Valencia, Spain Calafat, Dolj, Romania

Tate & Lyle Americas (A subsidiary of Tate & Lyle, PLC)

P.O. Box 151 Decatur, Illinois 62525 Domestic Plants: Decatur, Illinois 62521 Fort Dodge, Iowa 50501 Lafayette, Indiana 47902 Lafayette, Indiana 47905 Loudon, Tennessee 37774 International Plant: Guadalajara, Jalisco, Mexico

2 0 0 9 C O R N A N N U A L | P A G E 17

HONORARY DIRECTORS Martin Andreas Archer Daniels Midland Company Fred M. Ash Cerestar USA, Inc. Patrick E. Bowe Cargill, Incorporated C. G. Caldwell National Starch and Chemical Company Paul E. Grunder CPC International, Inc. E. S. Micek Cargill Trustees G. M. Mitchell Cargill Trustees Donald E. Nordlund A. E. Staley Manufacturing Company William H. Powell National Starch and Chemical Company Robert M. Powers A. E. Staley Manufacturing Company H. T. Reed Penford Products Co. John G. Reed, Jr. Archer Daniels Midland Company John Rice Archer Daniels Midland Company Samuel C. Scott Corn Products International, Inc. Michael A. Urbanic Cargill, Incorporated Richard Vandervoort Corn Products International, Inc.

C O R N R E F I N E R S A S S O C I AT I O N

1701 Pennsylvania Ave., N.W. Suite 950 Washington, DC 20006-5806 tel (202) 331-1634 fax (202) 331-2054 www.corn.org www.SweetSurprise.com